Climate Change and Sustainable Energy Bill - Standing Committee C

[Mr. Joe Benton in the Chair]

Climate Change and Sustainable Energy Bill

Mark Lazarowicz: I beg to move,
That, if proceedings on the Climate change and Sustainable Energy Bill are not completed at this day’s sitting, the Committee do meet on Tuesday 28th February at Four o’clock.
I welcome you back to the Chair, Mr. Benton, for our second sitting. I draw the Committee’s attention to the interests of which I notified it at our last sitting, which are recorded in the Official Report.

Question put and agreed to.

Mark Lazarowicz: I beg to move,
That the remaining proceedings on the Bill be taken in the following order, namely, new Clauses of which notice was given on or before 8th February 2006 other than new Clauses relating to commencement, Clause 5, remaining new Clauses, Clauses 11 to 14, new Schedules, remaining proceedings on the Bill.

Question put and agreed to.

New Clause 5 - National targets for microgeneration

‘(1)The Secretary of State must, during the period beginning with 1st November 2008 and ending with 31st March 2009—
(a)designate one or more national microgeneration targets, and
(b)publish a statement of that fact together with a copy of the target or targets.
(2)But subsection (1) does not apply unless on 1st November 2008 the Secretary of State considers that it would be appropriate to designate one or more targets under that subsection.
(3)For the purposes of this section, a national microgeneration target is a target in respect of—
(a)the number of microgeneration systems installed in England and Wales, and
(b)the number of electricity microgenerating systems installed in Scotland,
as at a date specified in the target (“the target date”).
(4)The matters to which the Secretary of State must have regard in determining whether subsection (1) applies include, in particular—
(a)the number of microgeneration systems installed in England and Wales,
(b)the number of electricity microgenerating systems installed in Scotland,
(c)the strategy published under section 82 of the Energy Act 2004 (c. 20) (microgeneration), and
(d)the results of any research carried out into the effect that designating a target under subsection (1) could be expected to have on the number of microgeneration systems that are installed in England and Wales, and the number of electricity microgenerating systems that are installed in Scotland, by the target date.
(5)If a target is designated under subsection (1), the Secretary of State must take reasonable steps to secure that the target is met.
(6)At any time before the target date, the Secretary of State may review the target and, if he considers it appropriate to do so, revise the target.
(7)If under subsection (6) the Secretary of State revises a target—
(a)he must publish a statement of that fact together with a copy of the revised target, and
(b)the revised target is treated for the purposes of subsection (5) and section (National microgeneration targets: modification of section 1 of the Sustainable Energy Act 2003) as the target designated under subsection (1).
(8)In this section—
“electricity microgenerating system” means a microgeneration system for generating electricity;
“microgeneration system” means any plant or system of plant for generating electricity or producing heat—
(a)which, in generating electricity or (as the case may be) producing heat, relies wholly or mainly on a source of energy or a technology mentioned in subsection (7) of section 82 of the Energy Act 2004 (c. 20), and
(b)whose capacity to generate electricity or (as the case may be) to produce heat does not exceed the capacity mentioned in subsection (8) of that section;
“plant” includes any equipment, apparatus or appliance.’.—[Mark Lazarowicz.]

Brought up, and read the First and Second time.

Amendment made: (a), at end insert—
‘(5A)If the Secretary of State does not designate a target under subsection (1) he shall publish forthwith a statement of his reasons.’.—[Mr. Barker.]

Clause, as amended, added to the Bill.

New Clause 6 - National microgeneration targets: modification of section 1 of the Sustainable Energy Act 2003

‘(1)This section applies if a target is designated under section (National targets for microgeneration).
(2)Section 1 of the Sustainable Energy Act 2003 (c. 30) applies in relation to every relevant sustainable energy report as if after subsection (1B) there were inserted—
and as if, in subsection (1C), for “subsection (1A)” there were substituted “subsections (1A) and (1BA)”.
(3)For the purposes of this section—
(a)a sustainable energy report is a relevant sustainable energy report in relation to a target designated under subsection (1) of section (National targets for microgeneration) if the reporting period to which the report relates includes the period, or any part of the period, to which the target relates,
(b)a target designated under subsection (1) of that section relates to the period beginning when it is designated and ending with the target date (within the meaning of that section),
(c)“reporting period”, in relation to a sustainable energy report, has the meaning given by section 1 of the Sustainable Energy Act 2003 (c. 30), and
(d)“sustainable energy report” means a sustainable energy report which is required to be published under that section.’.—[Mark Lazarowicz.]

Brought up, read the First and Second time, and added to the Bill.

New Clause 7 - Reports under section 1 of the Sustainable Energy Act 2003: microgeneration

‘In section 1(1A) of the Sustainable Energy Act 2003 (c. 30) (annual reports on progress towards sustainable energy aims)—
(a)omit “and” at the end of paragraph (b), and
(b)at the end of paragraph (c) insert “; and
(d)things done during that period for the purpose of implementing the strategy for the promotion of microgeneration in Great Britain published under section 82 of the Energy Act 2004.”.’.—[Mark Lazarowicz.]

Brought up, read the First and Second time, and added to the Bill.

New Clause 8 - Sale of electricity generated by microgeneration: power to modify distribution and supply licences etc

‘(1)Where the Secretary of State considers it appropriate to do so for the purpose of increasing the amount of the electricity consumed in Great Britain that is generated by microgeneration, he may make—
(a)relevant modifications of the conditions of a distribution licence or a supply licence held by a particular person;
(b)relevant modifications of the standard conditions of distribution licences or supply licences.
(2)For the purposes of subsection (1), “relevant modifications” means—
(a)in relation to a distribution licence, modifications—
(i)imposing conditions requiring the holder of such a licence to provide information to holders of supply licences about the connection to the distribution system, or use, of microgeneration plant, or
(ii)for the purposes of enabling or facilitating holders of supply licences to satisfy any conditions of such licences of a description mentioned in paragraph (b), and
(b)in relation to a supply licence, modifications imposing conditions requiring the holder of such a licence to offer to acquire electricity generated by microgeneration by the licenceholder’s customers;
and also includes incidental, consequential or transitional modifications.
(3)A modification under subsection (1)(a) of part of a standard condition of a distribution licence or supply licence does not prevent any other part of the condition from continuing to be regarded as a standard condition for the purposes of Part 1 of the Electricity Act 1989 (c. 29).
(4)Where the Secretary of State makes modifications under subsection (1)(b) of the standard conditions of distribution licences or supply licences, the Gas and Electricity Markets Authority must make (as nearly as may be) the same modifications of those standard conditions for the purposes of their incorporation in distribution licences or, as the case may be, supply licences granted after that time.
(5)Conditions included in a distribution licence or supply licence by virtue of a power conferred by this section—
(a)need not relate to the activities authorised by the licence, and
(b)may do any of the things authorised in relation to licences of that kind by section 7(2) to (4) of the Electricity Act 1989 (c. 29) (which applies to the Gas and Electricity Markets Authority’s power with respect to licence conditions under section 7(1)(a) of that Act).
(6)In this section and section (Exercise of powers under section (Sale of electricity generated by microgeneration: power to modify distribution and supply licences etc))—
(7)In section 33(1) of the Utilities Act 2000 (c. 27) (standard conditions of electricity licences)—
(a)omit “or” at the end of paragraph (a), and
(b)after paragraph (b) insert “or
(c)under section (Sale of electricity generated by microgeneration: power to modify distribution and supply licences etc) of the Climate Change and Sustainable Energy Act 2005 (sale of electricity generated by microgeneration: power to modify distribution and supply licences etc)”.’.—[Mark Lazarowicz.]

Brought up, read the First and Second time, and added to the Bill.

New Clause 9 - Exercise of powers under section (Sale of electricity generated by microgeneration: power to modify distribution and supply licences etc)

‘(1)Before making any modification of a distribution licence or a supply licence under section (Sale of electricity generated by microgeneration: power to modify distribution and supply licences etc), the Secretary of State must consult—
(a)the holder of any licence being modified, and
(b)such other persons as he considers appropriate.
(2)The Secretary of State must publish every modification made by him under that section.
(3)The publication must be in such manner as the Secretary of State considers appropriate.
(4)Where the Gas and Electricity Markets Authority makes modifications of standard conditions under section (Sale of electricity generated by microgeneration: power to modify distribution and supply licences etc)(4), it must publish the modifications in such manner as it considers appropriate.
(5)The Secretary of State’s powers under section (Sale of electricity generated by microgeneration: power to modify distribution and supply licences etc) are exercisable only during the period which—
(a)begins with the first anniversary, and
(b)ends with the third anniversary,
of the commencement of that section.
(6)Sections 3A to 3D of the Electricity Act 1989 (c. 29) (principal objectives and general duties) apply to the carrying out of functions conferred on the Secretary of State, or on the Gas and Electricity Markets Authority, by section (Sale of electricity generated by microgeneration: power to modify distribution and supply licences etc) or this section as they apply in relation to the carrying out of functions conferred on him, or on it, by or under Part 1 of that Act.’.—[Mark Lazarowicz.]

Brought up, read the First and Second time and added to the Bill.

New Clause 10 - Functions of the Gas and Electricity Markets Authority in relation to microgeneration

‘In section 47 of the Electricity Act 1989 (c. 29) (functions of the Gas and Electricity Markets Authority), after subsection (1) insert—

Brought up, read the First and Second time and added to the Bill.

New Clause 2 - Adjustment of transmission charges for electricity

‘(1)Section 185 of the Energy Act 2004 (c. 20) (adjustment of transmission charges) is amended as provided in subsections (2) to (4).
(2)In subsection (1)(a), for “of Great Britain” substitute “in Great Britain”.
(3)After subsection (3) insert—
(4)In subsection (11), for “more than ten years after the commencement of this section” substitute “later than 4 October 2024”.
(5)Subsection (7) of section 185 may be satisfied in relation to any order to be made under that section after the commencement of this section by publications and consultation taking place wholly or partly before that commencement.’.—[Malcolm Wicks.]

Brought up, and read the First time.

Malcolm Wicks: I beg to move, That the clause be read a Second time.

Joe Benton: With this it will be convenient to discuss Government amendment No. 15.

Malcolm Wicks: It is a pleasure to serve under your chairmanship, Mr. Benton.
New clause 2 will increase the support that can be given to renewable generators on the Scottish islands of Shetland, Orkney and the Western Isles. It builds on a power in the Energy Act 2004 enabling the Government to adjust the charges that renewable generators in a specified area of Great Britain must pay to use the transmission network, if the charges would otherwise deter renewable development in that area. Of course, the Scottish islands have great potential for renewable development—enough, I am told, to power the cities of Glasgow, Edinburgh and Aberdeen. I have been to the Western Isles on two occasions, and I saw  the potential for renewables on those wonderful islands. I very much hope that I will have the chance to visit some of the other islands in due course.
Renewable generation has important environmental benefits. The Government have made clear their commitment to supporting the development of such generation, which can help us to tackle one of the biggest challenges we will ever face: climate change. It can also bring important social benefits. Renewable development on the Scottish islands can provide a real boost to local communities. Indeed, a delegation of councillors from the islands came to see me some months ago to make the case for extending the benefits that we can give to renewable projects on the islands. I was impressed by what they told me about the community support for some of those projects and the way in which benefits can be channelled into local communities.
The power that we took under the Energy Act 2004 enables us to reduce the transmission charges that renewable generators on the islands will have to pay. Without that reduction, renewable generation on the islands would probably not be viable. The existing powers allow us to adjust charges for up to 10 years from the commencement of the provision in October 2004, so as things stand, any scheme would have to end in 2014. However, it became clear in the recent consultation exercise that renewable projects on the islands are unlikely to be operational before the beginning of the next decade. A scheme ending in 2014 would give insufficient support and would not make those projects viable. The new clause will enable us to extend any scheme to 2024, which will enable us to give the projects the support that they need to go ahead.
The new clause also makes a couple of technical changes. It will ensure that a scheme can be applied to separate islands and that the consultation requirement in the 2004 Act can be satisfied by consultation taking place before the provision in the Bill is commenced.
In summary, the Government are committed to encouraging renewable development. The new clause will give further support for renewable generation and ensure that the potential in the Western Isles, the Shetlands and the Orkneys is not wasted. I have listened carefully to the representations of colleagues representing the islands and to the local councillors who came to see me. I think that the provision is an important proposal. Amendment No. 15 is consequential, and is required to make the long title of the Bill reflect the inclusion of the new clause.

Michael Weir: The Minister will not be surprised to learn that I have talked about this issue on many occasions on the Floor of the House. I start by warmly welcoming the new clause; he has genuinely listened to what has been said by those on the Western Isles and northern isles, and it will make a great difference to generators in those island areas. I will not burden the Committee by going over the evils of the transmission charge regime introduced by Ofgem, which on the whole will do great damage to renewables in the north of Scotland.
I want to ask the Minister one or two questions. Can he be more specific when he talks about the territorial extent of the Western Isles and the north of Scotland? For example, the Pentland firth, which sits between the Orkneys and Caithness, has huge potential for tidal and wave power. It is not clear to me whether the proposal will affect only schemes that are actually in the islands, or whether it will also benefit schemes in the Pentland firth.
The Minister also talks about extending the period for a further 10 years. Am I right in thinking that the scheme is still based on the area and that it will run for a total of 20 years? Will the extension be based on the area rather than on a particular proposal? For example, if someone comes along in 10 years and wants to set up a scheme in the area, will they still have only 10 years rather than 20?
I appreciate that the Minister has listened and has done something for the northern isles, but I draw his attention to The Herald this morning, which has printed comments made by one of his predecessors, Brian Wilson, on Ofgem’s proposals. In fact, the headline is “Ofgem could stem tidal energy flow”, and he talks about the discriminatory charges against power carried from the periphery. I am not sure that we in Scotland like to be called the periphery, but none the less that is a good point that I have raised with the Minister on many occasions: the way in which the charges are structured militates against renewables.
The Minister has now done something about the islands, and I appreciate that, but he has done nothing about the mainland. The same problems affect the mainland and offshore installations such as the Beatrice installation on the Moray firth, promoted by Talisman Energy, which will not get any additional benefits as a result of the provision. If we are serious about renewables we must attack such problems.
I have no great faith in Ofgem from my own meetings and discussions with it during the passage of the Energy Act 2004. I raised many such issues and will not go through the detail again, but I ask the Minister to consider my points.

Gregory Barker: I do not intend to detain the Committee on the new clause, except to say that I broadly welcome what the Minister has said. The hon. Member for Angus (Mr. Weir) has raised some valid points and I look forward to hearing the Minister’s reply.

Malcolm Wicks: So I had better give the reply, I think, to the best of my knowledge. I will have to pass on the issue of the exact territorial extent. Will the hon. Member for Angus allow me to write to him on that issue? I recognise its importance but, geographically, I will have to take some advice. I have boasted that I have been to the Western Isles on two occasions, but unfortunately the second was when his party, using wind power, blew away the Labour candidate who I was supporting, my good friend Mr. Calum MacDonald. I did not investigate all the territories on that occasion.

Michael Weir: Will the Minister give way?

Malcolm Wicks: I am not sure that I should, actually.

Michael Weir: The Pentland firth is between the Orkney islands, not the Western Isles.

Malcolm Wicks: I understand that point—at least, I am certainly going to make out that I do. As I say, I have only been to the Western Isles and the other areas I will explore. I shall write to the hon. Gentleman on that important point.
A 10-year extension means that we could cover any project up to 2024. I hope that that clarifies that issue. On the issue of the mainland, I anticipated the question and prepared my answer earlier; I hope that it fits the bill. The question of the mainland, alongside that of the islands, was one of those raised in our consultation. We are still considering the responses that we received. However, we made it clear in the consultation that the evidence provided so far by independent consultants suggested that exercising the power on the mainland would result in little additional renewable generation, with most of the benefit going to projects that would have been developed anyway. That would not represent good value for electricity consumers, who will ultimately have to pay for the scheme. That is our current position.

Michael Weir: I understand the point that the Minister made about the area scheme regarding extension to 2024. If someone starts a scheme now they will get the benefit up to 2024, which will allow them a significant payback period. If they were to start the scheme in 2012, however, they would get only 12 years, which would not give the same payback scheme. Although we are talking about a 20-year period, the full payback period will apply only to a scheme started now or within the next year. Is that the case?

Malcolm Wicks: Under the original Act, we envisaged a 10-year period. As a result of the development of future projects, we listened and thought it appropriate to extend by another 10 years. I am a Fabian and a gradualist. The hon. Gentleman has got another 10 years—or rather the Scottish isles have. I cannot go further than that. That might not satisfy him, but that is the current position.

Question put and agreed to.

Clause read a Second time, and added to the Bill.

New Clause 3 - Renewable heat

‘(1)It shall be the duty of the Secretary of State to take such steps as he considers appropriate to promote the use of heat produced from renewable sources.
(2)For the purposes of subsection (1), heat produced by any plant is produced from renewable sources to the extent that the plant is fuelled by renewable sources.
(3)The steps which the Secretary of State may take for the purposes of subsection (1) include, in particular, steps for the purpose of promoting—
(a)the installation of plant which is or may be fuelled by renewable sources,
(b)the adaptation of plant so as to enable it to be fuelled by renewable sources, or
(c)the production of heat by plant which is fuelled partly by renewable sources and partly by other sources.
(4)In this section—

Brought up, and read the First and Second time.

Amendment proposed to the proposed new clause, (b), at end insert—
‘(3A)The Secretary of State shall lay before Parliament an annual report on—
(a)steps that he has taken to promote renewable heat and any steps that at the time of the report he proposes to take; and
(b)the effect of any steps taken by him and an assessment of any steps specified in the report that he proposes to take.’.—[Mark Lazarowicz.]

Question, That the amendment be made, put and negatived.

Clause added to the Bill.

New Clause 4 - Reports under section 1 of the Sustainable Energy Act 2003: energy efficiency of residential accommodation

‘(1)Section 1 of the Sustainable Energy Act 2003 (c. 30) (annual reports on progress towards sustainable energy aims) is amended as follows.
(2)In subsection (1)—
(a)omit “and” at the end of paragraph (c), and
(b)at the end of paragraph (d) insert “; and
(e)achieving the target set out in section 217(1) of the Housing Act 2004 (target for the energy efficiency of residential accommodation in England).”
(3)After subsection (1A) insert—
(a)emissions of carbon dioxide in England, and
(b)the number of households in which one or more persons are living in fuel poverty.”.’.—[Dr. Whitehead.]

Brought up, and read the First time.

Alan Whitehead: I beg to move, That the clause be read a Second time.
I hope that the Committee will agree to the new clause, whose aim is straightforward: to bring into the mechanism of the Sustainable Energy Act 2003, which contains requirements on annual reports on progress towards sustainable energy aims, the targets that are set out in section 217 of the Housing Act 2004. That section requires the Secretary of State to
“take reasonable steps to ensure that by 2010 the general level of energy efficiency of residential accommodation in England has increased by at least 20 per cent. compared with the general level of such energy efficiency in 2000.”
The purpose of the new clause is to add to the annual reports on progress towards sustainable energy aims provided for in the Sustainable Energy Act 2003 an annual report on that particular aim referred to in the Housing Act 2004. The new clause would also require a report to be given each year that examines both the
“emissions of carbon dioxide ... and ... the number of households in which one or more persons are living in fuel poverty.”
Such a provision would give some reporting milestones to the aim set out in the Housing Act 2004.

Gregory Barker: Again, I shall not detain the Committee long. The Opposition strongly support the clause and urge the Government to reach the target. That is particularly important given that they are behind on reaching their climate change targets. Perhaps I will go into that at greater length in respect of my own new clauses.
Energy efficiency is central to our efforts to combat climate change and represents the quickest, cheapest and perhaps the most easy way among all the different levers under our control to reduce carbon emissions. It has the double impact of helping the planet and helping to eradicate fuel poverty, and can therefore improve the lives of the hundreds of thousands if not millions of people in the UK who are still suffering fuel poverty or are at risk of doing so.
I am pleased to be chairing a Warm Front seminar tomorrow in Bexhill. Warm Front is a terrific campaign. It was initiated under the previous Government, and I am glad that it has been followed through positively and enthusiastically by this Government. There is still a great deal more for the campaign to achieve, however, and I hope that tomorrow in Bexhill I will get an opportunity to help to promote it locally. The new clause would bring back to the centre of government the importance of doing far more on energy efficiency. There is no better way to ensure that the Government do that than holding them accountable and auditing and monitoring their performance, which to date has not been good enough.

Andrew Stunell: I very strongly support the new clause moved by the hon. Member for Southampton, Test (Dr. Whitehead). I know from previous debates that the Government do not like making reports and producing targets unless they themselves have set them. It is a question of the Government taking some ownership of the need for progress and for the new clause to be added to the Bill. It is a low-cost option for the Government, as well as a simple step. It is a question that they should be happy and enthusiastic to answer. I very much hope that the Minister will take ownership and accept the new clause.
We need to take a look at how the Government deal with private Members’ Bills and how seriously they take their reporting and accountability role. My own Sustainable and Secure Buildings Act 2004 gave the Office of the Deputy Prime Minister some additional powers to deal with sustainable buildings and housing. The Minister may refer to the fact that a code of practice on sustainable housing is currently out for  consultation. He may say that it is premature for targets to be set. He may suggest that the process is working in non-statutory ways and that the Government are expecting the market to deliver or local authorities to act out of the goodness of their hearts or the fatness of their wallets to improve the sustainability of social housing. Perhaps the housing associations are intended to do that.
There is a big gap between the words that Ministers utter in this place and the performance on the ground in new building, let alone anything that might happen with the existing building stock. Accepting the new clause would be a good way for the Minister to unjam the ODPM’s current view about imposing, as it would see it, additional requirements on housing and to ensure that the Government’s intention to improve energy efficiency and to increase the sustainability of housing takes priority. It would send a signal to other Departments, and particularly the ODPM, that it is not enough to rely on the market to produce the environmental and sustainability benefits that everybody in this room wants to see.
I urge the Minister to take a serious look at the new clause. It would not cost him very much, it would send an important signal to other Departments and it could be an important way to help the United Kingdom meet its sustainable energy targets.

Malcolm Wicks: We do indeed support new clause 4. Back in 2004, we published a new residential energy efficiency aim, as required by the Sustainable Energy Act 2003. We felt that we could save 3.5 million tonnes of carbon emitted from homes in England. Later that year, the Housing Act 2004 set a second target for household energy efficiency, requiring the Secretary of State to take reasonable steps to improve residential energy efficiency by 20 per cent. by 2010, with the year 2000 as the baseline.
The Housing Act 2004 did not require the Government to publish a report on progress toward the energy efficiency targets. The reporting requirement in the 2003 Act was addressed by the Energy Act of 2004, which obliges the Government to report annually on progress. Therefore, it seems logical to include in the Bill before us an equivalent reporting requirement for the Housing Act 2004 and its targets.
Should the Bill obtain Royal Assent with the clause in place, we would fulfil its requirements as part of the Government’s annual reports on implementation of the energy White Paper objectives. That would be consistent with the approach currently taken for other reporting obligations under the Sustainable Energy Act 2003. I am bound to say that combining those reports would also be energy efficient. I am pleased to confirm that the Government fully support the clause.

Question put and agreed to.

Clause read a Second time, and added to the Bill.

Joe Benton: We will now come to new clause 13. I call Mr. Barker to move the new clause.

Gregory Barker: Thank you, Mr. Benton. I wish to start by withdrawing new clause 13 in favour of new clause 14.

New Clause 14 - Parish councils: power to set up local energy schemes

‘(1)Subject to this section a parish council (or community council in Wales) may establish or assist in the establishment of a local energy scheme.
(2)If a parish council (or community council in Wales) is satisfied that a local energy scheme would—
(a)assist with the purposes of this Act,
(b)help promote local employment,
(c)generate economic activity within its area, or
(d)in any other way encourage or assist with measures to reverse community decline,
then that council may establish or assist in the establishment of a local energy scheme.
(3)Two or more such councils may jointly establish or assist in the establishment of a local energy scheme.
(4)In this section a local energy scheme is a scheme which—
(a)improves energy efficiency, or generates sustainable energy primarily for consumption, in the area or areas of the council or councils concerned; and
(b)is situated in the area or areas of the council or councils concerned.’.—[Gregory Barker.]

Brought up, and read the First time.

Gregory Barker: I beg to move, That the clause be read a Second time.

Joe Benton: With this it will be convenient to discuss the following: New clause 15—Clarification of power to promote well-being—
‘(1)Section 2 of the Local Government Act 2000 (c. 22) (promotion of well-being) is amended as follows.
(2)After subsection (6) insert—

Gregory Barker: New clause 14 would give an enabling power bringing 10,000 parish councils into the national efforts to reduce climate change and to alleviate fuel poverty. We need their efforts and their local knowledge. As a sponsor of the Local Communities Sustainability Bill in 2003, and as one of the cross-party advisers to that campaign, I feel strongly about the issue. We need to mobilise an army of opinion throughout the country, and parish councils are the linchpins of rural and suburban communities.
I emphasise that we must unleash the local knowledge of thousands of councils. Here at Westminster, we cannot possibly know everything that they may wish to do. That is the beauty of the new clause: it would confer enabling powers to bring forth new ideas and fresh thinking based on the local circumstances and particular needs of individual communities throughout the country, empowering local people. It would involve communities everywhere.
I emphasise, too, that nearly 700 such councils signed up for the Local Communities Sustainability Bill. Almost all the public meetings on that Bill were  attended by 100 to 400 people. During those meetings in towns and villages throughout the country, local energy was invariably one of the first topics. People are interested in what they can do locally. They worry about climate change, absolutely, but there is also a sense of powerlessness among the public at large. The clause is designed specifically to address that, enabling people—individuals, families, communities, neighbours—to get involved and to feel that there is something that they can do.
Let me inform the Committee about some of the initiatives that could result from this enabling clause. The Sustainable Energy Partnership very helpfully did a phone-around of some parish councillors. I do not pretend that the list is comprehensive or that it should be seen as a rigorous survey; it is just a selection of a few ideas that have been suggested by parish councillors who are supporters.
One suggestion was to appoint a microgeneration or local energy officer to promote and work with area power companies. Obviously that is something that most parish councils would not be able to do on their own, but they could co-operate in informal networks to do it on an appropriate scale. In appropriate parts of the country, certainly in Scotland, there could be hydro-site surveys to find the best areas for local companies and community schemes. There could also be wind power surveys to find the best areas for local companies and community schemes. If there is going to be an extension of onshore wind power, it has to be with community consent. It has to be at the instigation, and with the co-operation of, local people; not, as has sadly happened in certain very notable cases, over their heads, giving the renewables energy movement a bad name. Local buy-in to wind power is important and parish councils are an ideal way to facilitate it.
Other ideas include promoting biomass to, and with, local farmers; small kick-start grants for microgeneration; installing trainer schemes for local young people; opportunities for parish councils to receive information on public-private partnership schemes; and opportunities to endorse local energy and energy efficiency schemes, with leaflets and advertising. It is so much more effective if there is local buy-in to those promotions, rather than if people receive standard, centrally distributed information from Whitehall.
Further suggestions include competitions for suppliers, such as “Give us the best deal, and we’ll promote your product in return for a discount on equipment.” Companies could be persuaded to take opportunities to deal with fuel poverty, by using innovative technology. There could be bulk purchase opportunities, particularly in relation to energy efficiency and microgeneration, to get discounts and resell what can often be quite prohibitively expensive technologies to individual householders.
Not all parish councillors have an officer, but there could be someone—the clerk perhaps—who could volunteer to attend the Home Energy Conservation  Act 1995 regional forums to disseminate latest best practice and innovation in the all-important area of energy conservation. Inter-parish energy forums could be established to bring together and promote good ideas and best practice, so that people can learn from the practical experiences of other communities who have tackled the problem. That would underline the whole notion that we are all in this together.
There is a host of good ideas that the new clause could help to make happen. Why is it so important? I shall not labour the point but I shall give one reason. Not so long ago, the Prime Minister told the House of Commons that as regards the Government’s manifesto commitment to reduce carbon dioxide emissions by 20 per cent. by 2010, based on 1990 levels, on current policies:
“Instead of a 20per cent. reduction, we will achieve one of 14per cent.”—[Official Report, 8 December 2004; Vol. 428, c. 1161-62.]
By January of this year, however, the Government’s energy review announced that, on current policies:
“Our latest projections suggest that the UK will have reduced CO2 emissions to around 10 per cent. below 1990 levels by 2010.”
In other words, the target is falling, and we are going backwards, not forwards. So it is clear that a lot more needs to be done and that the Government in Westminster and Whitehall do not have all the answers. We need to mobilise the parish councils and involve the rest of the nation. The problem of climate change cannot be tackled in Westminster alone, so let us take the campaign local. I urge the Committee to support the new clause. It will involve up to 10,000 new councillors in striving towards an objective that we all wish to see achieved.

Andrew Stunell: Again, I rise to support the hon. Gentleman’s new clause. Many opportunities are best taken at grass-roots level, and the parish level of government in England certainly provides the democratic involvement that can lead to the engagement of the local community and its ownership of a scheme that is promoted by the parish. It is not even top-down from parish level; it is more a question of the parish being a suitable vehicle to harness local willingness to take this type of action forward.
I hope that the Bill’s promoter and the Government will look kindly on this very modest addition to the Bill, which provides a useful enabling power for the lowest democratic level in England and will clearly be of value and benefit in some very specific cases. I hope that it will also create a fashion for engaging in sustainability and environmental improvements.

Gregory Barker: I would now like to speak to new clause 15. Its aim is to clarify the well-being powers of local authorities under section 2 of the Local Government Act 2000 in relation to measures to alleviate climate change, which might not be covered by the present legal power.
There is complete unanimity on the objectives of the new clause—that the wide well-being powers for local authorities under section 2 of the Local Government Act 2000 should enable action on climate change. There is strong and good Government guidance to that effect, so there is clearly no division there; we are  all as one. However, I am advised that the law might not allow such action. Section 2(1) gives councils the power to do anything that will achieve any of the following:
“the promotion or improvement of the economic well-being of their area ... the promotion or improvement of the social well-being of their area ... the promotion or improvement of the environmental well-being of their area.”
Section 2(2) clarifies that, saying that powers may be used for
“the whole or any part of a local authority’s area, or ... all or any persons resident or present in a local authority’s area”.
Everybody expects that to cover schemes to alleviate climate change, but there is some evidence that it might not.
For example, let us suppose that a local authority decides to back a small wind farm that will reduce CO2 emissions. It is sited skilfully and with the consent of the local community, so there is no local opposition, and planning issues are properly dealt with. It might be a private or a community scheme, as envisaged under clause 9 of the Bill. The council wants to use its resources—people and perhaps even money—to help to get the scheme going, and thinks that that can be done under section 2 of the Local Government Act 2000. Government guidance says that it can do that, but does the law?
The proposed scheme will not promote or improve the economic well-being of anybody in the area, because there will be no local jobs—the supplying company will just arrive, install the turbine and leave. It will not necessarily promote or improve the social well-being of any people living in the area, as the resulting energy will simply be sent through the national grid, and it might not promote or improve the environmental well-being of any people in the area because the CO2 reduction, crucial as it is, does not of itself do that. It is true that it could play a tiny part in reducing the chance of flooding or bad weather in 20 to 50 years’ time, but it may not improve the environment of the people living there now as the law requires. Even the most ardent champion of renewable power would baulk at suggesting that. I ask hon. Members to imagine that CO2 has been reduced in their area by such a scheme—that is terrific, and indeed, vital—but I ask them how it benefits them and their neighbours now.
CO2 reduction is vital, but it may not, of itself, benefit the residents of the area now. The well-being power under section 2 of the 2002 Act may not apply and that is absurd. No one wants that; it was never the intention, but, believe it or not, some local councillors have been told by legal officers that the well-being power may not extend to initiatives that only, or exclusively, reduce CO2. In this litigious age, the law needs clarification to give certainty to local legal advisers.
I hope that the Minister will back the new clause, which would achieve what we all want. I hope it will offer clarity and encourage local councils who are on the brink of taking action, but who were tipped back by the measure towards not taking action. I offer the new clause as a genuine way to remove any legal doubt that may exist in some quarters.

Malcolm Wicks: This has been an interesting and useful debate and I have listened with great interest to hon. Members’ remarks. We have much sympathy with the intentions of new clause 14. Parish councils, especially the larger ones, rather like town councils, may well have a role to play in setting up local energy schemes. I am enthusiastic about enabling the community to play a role in respect of climate change.
I have a feeling that some of the anoraks in the micropower sector—I am not suggesting that there are any—

Andrew Stunell: They do not need them if they have micropower.

Malcolm Wicks: I do not think it stops rain. I might develop a joke about parish heat pump politics, but I will leave it at that.
I was interested in the range of possibilities under the community energy heading in which parish councils could get involved, and particularly intrigued by the idea of inter-parish energy forums. Perhaps on Report, an hon. Member will table an amendment, which we may not accept, that people can only walk or ride their bicycles to the inter-parish energy forums. We need consistency in what we are doing.
We should not lose sight of the fact that parish and town councils vary enormously in size, activities and circumstances. The main source of a parish council’s income is its precept on the district or unitary council. They are not, however, subject to the constraints on principal authorities through financial measures such as capping. The powers of well-being in the Local Government Act 2000 do not apply to them.
Parish councils could rely on the powers they have under section 137 of the Local Government Act 1972 to set up local energy schemes, which is a general power to spend where expenditure is in the interests of, and will bring direct benefit to, the area. The power is limited to spending locally and there are some legitimate doubts over the scope of it. In principle, we think the power that the new clause would introduce could be useful, and would enable parish councils to take part in setting up local energy schemes.
We have some concerns about the scope of the limited power that local councils have in that respect and we need to explore the issues further. I undertake to consider them in greater depth with the intention of tabling a Government clause at a later stage. In the light of my comments, I hope that the hon. Gentleman will be persuaded to ask leave to withdraw the new clause.
New clause 15 proposes an amendment to the Local Government Act 2000 to clarify the fact that the powers given to principal authorities to promote or improve the economic, social and environmental well-being of their areas also enable them to take action to alleviate climate change. The intention is well founded; if we are to succeed in reducing the emission of the harmful greenhouse gases that are causing climate  change, we need to take action at all levels, not just in the international arena or in nation states, but at the most local of levels.
Local authorities are taking action. Bracknell Forest borough council is a good example; it has used well-being powers to provide a financial guarantee, enabling the go-ahead for the use of sustainable energy in its town centre regeneration. I am advised that a number of London boroughs have used the powers to work with an organisation called Smart Moves Ltd—it sounds like it might be advising the Conservative party at the moment, but I do not know whether it extends that far—in the setting up of CityCarClub, which helps to reduce car use, thereby reducing pollution, congestion and greenhouse gas emissions. Local authorities are therefore already using well-being powers to tackle climate change, which is why I believe the proposed clarification to be unnecessary. The new clause may also cast doubt on the breadth of the power to promote or improve well-being, by signalling that it is not as wide as indicated by the statutory guidance. We believe that it is likely to cause more confusion than clarity.
The Government were required by the Local Government Act 2000 to produce statutory guidance on the exercise of the well-being powers, which is useful in this debate. The guidance followed consultation with local government representatives, and was launched in March 2001. Before exercising the powers, principal authorities must have regard to the statutory guidance. Paragraph 6 sets out a broad range of the powers and states:
“Authorities will also wish to consider how the new power can help them to contribute locally to shared national priorities, such as action to combat climate change.”

Gregory Barker: I am listening carefully to the Minister. Is he aware of any councillors or councils whose legal officers have told them about the guidance? If not, is that because there have not been any cases of such advice being given, or because his officials are unaware of them? If it is the latter, will he examine whether the point is being made?

Malcolm Wicks: I understand—I use that word because I am not an ODPM Minister; I am taking advice from the Minister and colleagues in that Department—that there has been confusion over the interpretation of the well-being powers. We should therefore undertake to seek to clarify the issue. It is more about information and education than taking a new power.
The well-being powers are part of a wider framework that includes the duty to produce a community strategy. Such strategies promote or improve the economic, social and environmental well-being of their area, and contribute to sustainable development in the UK. The statutory guidance, which is called “Preparing community strategies,” reinforces the message that combating climate change falls well within the scope of the powers.

Alan Whitehead: In addition to seeking information on whether local authorities have received legal advice in the way that the hon. Member for Bexhill and Battle (Gregory Barker) suggests, will my hon. Friend consider strengthening and redirecting the statutory guidance towards local authorities, so that that point is emphasised? Will he suggest that to the Minister responsible at the ODPM?

Malcolm Wicks: The best thing that I can do is ensure that my hon. Friend’s remarks are brought to the attention of the Minister responsible and the ODPM. That has already happened, as it were, and they will reflect on his suggestion.
The Government’s two pieces of statutory guidance on the framework for improving the well-being of communities make it absolutely clear that local authorities can use their power of well-being and community strategies to combat climate change. I understand that some local authorities have received legal advice. This is complex because it will depend on the action being proposed. Adding the suggested wording would not make anything legal that was not legal before. If an action to combat climate change is currently illegal, the new clause will not change that. The legal advice to which I think the hon. Member for Bexhill and Battle was referring may have been about the specifics of what would be legal or illegal rather than a general statement about well-being.
I give this undertaking on behalf of my colleague in the ODPM. We will reflect on what has been a useful debate. At the moment, there is nothing to stop the kind of projects that the hon. Gentleman described. I understand that there is confusion. There is an issue here about further clarification, although not in terms of statute. We are talking about better communication of powers. Indeed, I hope there would be some encouragement that parish councils will use these powers. I was wondering about parish meetings, but that is perhaps going too far. We all have a vested interest in combating climate change. I will have to oppose new clause 15 if it comes to a vote. In principle, we agree to new clause 14 and are looking at that.

Gregory Barker: I am grateful for the Minister’s comments about new clause 15. There is undoubtedly no difference between us in the intention here. It is simply about the practical implementation of the law on the ground. As is patently obvious, I am not a lawyer and the Minister has recourse to the advice of a great many experts. I am grateful for his acknowledgment that there is a real problem in implementation.
It may be that it is simply a misunderstanding for which the solution could be a robust restating of the statutory position. If we can solve the problem, even if it is only a small one, without recourse to primary legislation, that is a good thing. I am all in favour of not using the law when it is not necessary. If the Minister could write to the Committee once he has had a chance to confer with the ODPM, that would be very welcome and would help to reassure us that this will not simply be one of those issues that starts with good intentions, but loses momentum as the Committee  disappears. Having made the point and found agreement across the Committee, I do not intend to press new clause 15.
I was greatly heartened by the Minister’s comments about new clause 14. If he and his officials have thoughts on how the provisions to empower those 10,000 parish and town councils may be better drafted, I will welcome that. As a champion of localism, I recognise that the effort to bring all those local committees into the battle against climate change will be much easier if it has the authority of a Government-drafted amendment rather than an Opposition amendment. In the interest of consensus and constructive cross-party politics, I beg to ask leave to withdraw the motion.

Motion and clause, by leave, withdrawn.

New Clause 16 - Planning and renewable energy

‘(1) Any person undertaking—
(a)a new commercial development exceeding 1,000 square metres, or
(b)a residential development exceeding five units,
must make appropriate provision within the development for on-site renewable energy.
(2)A local planning authority must include policies to encourage on-site renewable energy in its development plan.
(3)In this section—

Brought up, and read the First time.

Gregory Barker: I beg to move, That the clause be read a Second time.

Joe Benton: With this it will be convenient to discuss New clause 19——Review of permitted development orders—
‘(1)The Secretary of State shall for the purpose mentioned in subsection (2) carry out a review of the effect in England of development orders made by virtue of section 59(2)(a) of the Town and Country Planning Act 1990 (c. 8) (which confers power by order to grant planning permission for development or a class of development specified in the order).
(2)The purpose of the review is to enable the Secretary of State to form a view as to what provision (or further provision) such development orders should make to facilitate development in England consisting of the installation, within the curtilage of a dwellinghouse, of equipment, apparatus or appliances for microgeneration.
(3)As soon as reasonably practicable after he has carried out the review, the Secretary of State must lay before Parliament a report of the review, including his view as mentioned in subsection (2) and the reasons for it.
(4)The report must also set out what provision (or further provision), if any, the Secretary of State proposes to make in development orders by virtue of section 59(2)(a) of the Town and Country Planning Act 1990 (c. 8) in consequence of the review.
(5)Where the Secretary of State proposes to make provision (or further provision) in development orders in consequence of the review, he must—
(a)exercise his powers under section 59 of the Town and Country Planning Act 1990 (c. 8) so as to provide that development orders made by virtue of that section make such provision in consequence of the review as he considers appropriate, and
(b)exercise those powers as soon as reasonably practicable after laying the report before Parliament under subsection (3).
(6)In this section—

Gregory Barker: I am struck by two recent developments. First, as in so many areas of public life, it has been at a local level that we have seen the highest profile and most successful examples of zero and low-carbon policy measures, including energy efficiency. In both Merton and the Minister’s own borough of Croydon, the local authorities have successfully implemented a planning policy to require on-site renewable energy systems, such as those based on solar and wind power, in all major new developments. In Croydon, some 55 projects have been approved under the policy in the first 18 months. That is 55 developments with renewable energy systems in just one borough as a direct result of Croydon’s pioneering approach. Why are Ministers not shouting from the rooftops about the success of the policy and urging other local authorities to follow suit?
The second development that struck me is that mainstream developers are increasingly seeking ways to integrate renewable energy and energy efficiency systems into new buildings. Those technologies are no longer considered unfeasible technically, or as imposing an undue financial burden. If anything, they tend to make new commercial buildings more attractive to potential purchasers and tenants. Many companies are demonstrating that they see that as an integral part of good quality building design and construction, of ensuring competitive advantage in the marketplace and of attracting the brightest and best employees, as well as of sending a clear signal to the market and to their customers.
As might be expected, my new clause is supported by a wide range of organisations, including the Renewable Energy Association, the Town and Country Planning Association, Friends of the Earth, the British Photovoltaic Association—known as PV-UK—the Solar Trade Association, the Green Alliance and companies that are active in the sector, such as Solar Century and Sharp UK.
My new clause has also attracted serious business support beyond what one might term the usual suspects. Only yesterday, I received a letter of support from the chairman of Gazeley, a UK subsidiary of Wal-Mart based in Milton Keynes. Wal-Mart, of course, is based in north America. Gazeley is responsible for developing distribution warehouses for many of the top multinational companies across the  UK and continental Europe, and is widely recognised as one of the leading, if not the leading, European logistics operators.
Gazely has already embraced the issue positively and cost-effectively by starting to integrate solar and wind technologies into new UK commercial developments. It is doing so for sound business reasons. We are making progress at a pace that may not always be appreciated by Ministers in Whitehall. If Ministers and officials find it hard to believe the solar industry when it talks about the technology’s potential in the UK, and if they discount a little of what it tells them on account of its in-built interest, perhaps they will give more weight to the views and experience of the chairman of a major European property developer of logistic space based in the UK.
Wal-mart is not known for its dewy-eyed approach to business or to anything that would put undue strain on the bottom line. It is renowned for its aggressive pursuit of profits and anything that came out of that company certainly could not in any way be seen as something that could not be adopted and taken forward by others with an equally competitive advantage in the marketplace.
My new clause is entirely in the spirit of the Bill. The hon. Member for Edinburgh, North and Leith (Mark Lazarowicz) explains in his explanatory notes that clause 5
“will put microgeneration on the agenda of local authorities”
and there is nothing wrong with that. However, we have an opportunity to go beyond the setting of local targets. Many local authorities have expressed an interest in developing policies similar to those in the Minister’s home borough, but two problems remain.
Planning policy statement 22 on renewable energy, published by the ODPM in 2004, enables local authorities to go down that path, but it is subject to inconsistent interpretation by ODPM inspectors and Government officers. Last week, for example, officers at Breckland council in Norfolk reported publicly that they had encountered difficulties with the Government office, and others in the area have reported similar problems. Those isolated examples may be confined to one Government office, but at a time when climate change and the urgent policy responses needed to deal with it are high on the political agenda, it is one problem too many. Frankly, we do not have the time to let ambiguity and misinterpretation get in the way of progressive policy change at a local level.
More important, the new clause challenges the ODPM’s assumption that a simple enabling clause in PPS22 ticks the box on the need for practical, potential planning policy to require on-site renewables in the built environment. It does not. Local authorities are being required to write new local development frameworks, which gives us the opportunity to maximise the number of developing policies similar to those in Croydon.
At a time when ODPM officials are reminding regional and local authorities of the need to include the Barker review assumptions and conclusions in their local plans, it is bizarre that no similar effort has been made to encourage local authorities to adopt best practice and planning on renewables and energy efficiency. As has been stated, energy efficiency remains the cheapest, quickest and cleanest way of achieving our climate change mission targets. Energy efficiency and renewable energy are not either/or options.
I fully recognise that we are not starting with a blank page. Policy is out there, it is legal and in many places it is working, but we need to see more than a few islands of good local authority practice, such as in the Minister’s back yard, surrounded by a sea of minimum standards.
Positive local planning policies also offer a huge commercial potential for the UK renewables industry. It has been estimated that, if 250 authorities were eventually to adopt positive planning for renewables policy, the annual market in the three technologies of solar thermal, solar photovoltaic and micro-wind would be £755 million a year. The annual market for those technologies in the UK is now about £30 million. The new clause would encourage the more widespread adoption of such policies by clarifying PPS22 and ensuring that all local authorities developed a variant of the Minister’s Croydon policy.
The Government have the opportunity to play a leading role, not in picking winners or singling out individual technologies, but in creating a national framework that would stimulate a pioneering industry and make us world leaders. We have a huge economic opportunity as well as an environmental one—if we grasp it now. We can become leaders, and certainly European leaders, in that field.
Lord Rogers reminded us last autumn that the UK’s record on delivering genuinely sustainable communities has so far been pathetic. It does not have to be like that. The Government are not afraid to take a lead in some areas, and they should not be timid in this area. It is no good having a policy of fine words if it is not followed through. Some will argue that such issues need time.
I understand the concerns of some developers about additional costs, but we need to keep those costs in perspective. I never cease to be amazed at what totally inadequate carbon standards are required for new buildings in the capital. Marsham Street, just around the corner from the Palace of Westminster, has been redeveloped. Prices for the smallest flats start at £390,000. I have found no one to explain why it was not made a condition of redevelopment that each unit should be built to the highest standards of energy efficiency, including at least some measure of on-site renewables.
Alternatively, rather than considering an expensive Westminster flat, let us take a mainstream house builder such as Barratt Homes, whose average national house price is £165,000. The additional capital cost of installing the solar PV required to reduce carbon emissions by 10 per cent. on one of its  new-build estates is the equivalent of just 0.9 per cent. per dwelling. By installing the PV on every sixth home, rather than all of them, the estate builder can easily and efficiently meet a 10 per cent. reduction target from renewables over and beyond 2006 in terms of part L of the building regulations, and can, of course, market the solar house at a premium on the price of its standard homes.
We have to remember that that is a 0.9 per cent. cost for a technology that many regard instinctively as an expensive renewable energy option. If nascent technologies are to break out of the niche that they currently fill and enter the mass consumer market, the Government have a role to play, not by picking winners or preferred technologies, but by helping to create consumer demand that will feed and nourish the young markets.
Very deliberately, my new clause would not impose centrally agreed renewable energy targets on every local planning authority. I have spoken at length about my belief in localism. In some parts of the country, for good local reasons, the 10 per cent. target—a figure that was adopted in Merton and Croydon, for example—could, following local consultation, be surpassed as an appropriate requirement, reflecting local economic, social and environmental needs. However, I recognise that in other parts of the country, the figure might have to be lower. Nevertheless, all local authorities should have to set a local minimum standard and requirement, taking into account local conditions.
The new clause has the potential to deliver significant results for the short-term uptake of micro-renewable technology. If the Government support it, they will send a strong signal to local authorities that are writing their local development frameworks as we speak. If they do not support it, we will end up with, at most, 12 to 15 per cent. of local authorities adopting such a policy, even though this Committee has the means to ensure that 100 per cent. do so. I call on the Minister to be ambitious, and to take up my suggestion.

Mark Lazarowicz: The hon. Member for Bexhill and Battle has made some very important points. I hope that at least the thrust of what he has said will find broad agreement in the Committee. I do not know whether he has tabled the new clause as a probing amendment, which he will withdraw depending on what the Minister says, or whether he intends to press it to a vote. He and my hon. Friend the Member for Southampton, Test, as well as colleagues from all parties, today and on other occasions, have performed a useful exercise in teasing out the policy implemented by the Office of the Deputy Prime Minister.
I have some reservations, however, about the way in which the new clause is drafted, because as we have heard in discussions on other issues relating to this area of activity, we need to be precise about what we seek to achieve through legislation. Too many times, we adopt legislation, but its intentions are not carried through when it comes to policy areas such as sustainable energy. I am concerned that, for example, the requirement on developers to make appropriate  provision is too vague. What is appropriate in the view of the hon. Member for Bexhill and Battle will be left to local discretion. However, it seems to me that we must state some kind of requirement, otherwise a range of possibilities will be made available to aggrieved developers who want to appeal on the basis that the provision that has been made is not appropriate. The current wording could lead to a lot of difficulty.
In addition, although one must be wary of going along a road that would allow people to draw back from the good intentions of the new clause, it seems that there will be some occasions, and some developments, on which it will not be possible to make renewable energy provision of the type that would otherwise be desirable. Perhaps in that sense the new clause is too prescriptive. My understanding is that combined heat and power is not usually defined per se as a renewable energy source. Although it is energy efficient, it is not necessarily provided by renewable sources. Sometimes, the best way to meet energy objectives would be to encourage a small-scale combined heat and power development, but that would not fall within the scope of the proposal. I am worried about the consequences, if not the intent, of the new clause, as I believe the objectives could be achieved in a better or different way.

Andrew Stunell: I very much support the intention and direction of the new clause. As the hon. Member for Bexhill and Battle said, major commercial organisations see the value of taking seriously energy efficiency and the potential use of renewables because it is cost-effective. As he said, they would not be doing so unless the bottom line was that they would benefit.
It is sad that the cost benefits are sometimes more visible to the industrial and commercial sector than to the domestic sector. It must be evident that incentives, regulations and a legislative framework need to be introduced. That would make it easier for new projects, whether they are industrial, commercial or in the domestic sector, to make the best available use of the technology to have energy efficient buildings and to draw in renewables. The new clause would provide an interesting foundation for that to happen.
The hon. Member for Bexhill and Battle mentioned Merton and Croydon. Two years ago, the London borough of Merton was locked in a difficult negotiation with the ODPM about whether it would be permitted to do what is proposed. We have come a long way from an argument with the Government about whether a local authority was permitted to make such provision in planning policies to discussing a clause that might require local authorities to do so. That might be a big jump for the Minister, and an even bigger jump for the ODPM.
I am sorry to keep referring to my Sustainable and Secure Buildings Bill, but essentially it covered the same areas of policy. An early version had a simple clause saying something like, “For the avoidance of doubt, what Merton wants to do is lawful.” ODPM Ministers said that that would not be necessary because they were going to give in to Merton, while 12 other local planning authorities were queuing to press  their case and to see whether the ODPM would concede their right to interpret existing legislation to allow them to make the provision. The situation now is that a local planning authority is permitted to do what the hon. Gentleman set out, but at the time, I was in discussion with several other planning authorities in the queue, waiting to see which way things would go. It was perhaps only when the London borough of Merton made it clear that it would go to the High Court to challenge a refusal that the ODPM backed down.
A matter that has arisen already in several different contexts in this debate and in our previous sitting is the lack of joined-up thinking by various Government agencies and Departments about how to implement what is supposed to be the highest priority in long-term policy plans: dealing with climate change. It cannot be right that when forward-thinking local authorities—I am prepared to confess that the London borough of Merton is Labour-controlled—

Malcolm Wicks: So is Croydon.

Andrew Stunell: I fully accept what the Minister says. In the queue behind Merton was the metropolitan borough of Liverpool, which is controlled by the Liberal Democrats, and there were Conservative boroughs in the queue, too; it is not a party-political matter. Throughout the country, local planning authorities of every political persuasion are keen to move forward. On that occasion, they found that central Government stopped them.
Although I understand that the Minister might not want to take the wording on board, perhaps he could acknowledge the thrust of the new clause. The national Government need to say to local authorities not simply “If you twist our arm, we’ll let you do it,” but “We positively want you to do it, and please get on with it.” If that is the spirit of the new clause, it should have his support.
As a keen supporter of the Bill, I listened carefully to what its promoter said about his approach to the new clause. The last thing that I want to do is sabotage inadvertently the Bill’s prospects of progress. I hope that the hon. Member for Bexhill and Battle will reflect on that when he sums up, because it would be a great shame if his enthusiasm for a highly desirable move were to get in the way of the Bill’s further progress.
I give that cautionary word to the hon. Gentleman and I hope that the Minister will accept a cautionary word from many of us. I ask him to get the agencies, Ministries and Departments pushing in the same direction, rather than hindering some of the initiatives that would help them deliver on their national aim of tackling climate change, improving energy efficiency and delivering more renewables in the United Kingdom.

Theresa Villiers: I greatly appreciate the opportunity to address the Committee on such an important new clause to such  an important Bill. If the Bill is to have an impact and to expand dramatically the scope of renewable energy and microgeneration, as we hope it will, the new clause could have a significant impact on bringing about that goal. It is vital that we tackle the issue of new build. We need much more action on renewable energy from developers; I should also like to see action on energy efficiency. That is one of the key levers available to us in the House for encouraging changes in practice and the expansion of microgeneration.
If the Committee agrees to the new clause, we will tilt the planning system toward renewable energy and microgeneration and towards requiring councils to include action plans to encourage the take-up of such schemes. That will have a significant impact. We would do well to listen to the advice of a number of the organisations focused on environmental and renewable energy issues that support it. Their concerns on the matter have impressed me, in that I support the new clause.
The new clause is also very timely, as local authorities are currently looking at their development plans and frameworks. Choosing not to go down that road would mean an opportunity sadly missed, because the clause should be a vital part of achieving the Bill’s aims of expanding the amount of microgeneration in this country. For those reasons, I urge the Committee to support the new clause.

Joe Benton: Before I call the Minister, I remind the Committee as a matter of order that we are also discussing new clause 19. Does the hon. Member for Southampton, Test want to speak to it?

Alan Whitehead: I should be delighted to speak to new clause 19. The hon. Member for Chipping Barnet (Mrs. Villiers) mentioned the need to make a substantial impact on how microgeneration works in terms of our buildings and communities. The whole topic of microgeneration concerns the fact that it is micro and, by and large, it works on buildings. Therefore, if there are various impediments to the installation of microgeneration—even where it is generally acceptable and takes place within defined limits—we are perhaps not implementing the otherwise good intentions that we all share on how to develop renewable energy sources in our homes and buildings.
The new clause attempts to address that problem. The truth of the matter up and down the country is that if people are in the process of seeking to place a microgeneration device in or on their houses, they do not know what the reaction of the local authority will be. Many local authorities will say that it is fine. Sometimes, there will be objections that have not been raised by the local authority next door. Within a few miles, there may be one house with a solar PV installation on the roof that has been franked and okayed by planning officers, whereas in the next local authority a person undertaking the same activity has to pay a large amount of money and go through the planning application process. That is because the position on whether such devices need planning permission is very unclear.
Manufacturers of microgeneration devices are not clear as to the advice they can give to purchasers, and whether they can honestly say, “You can take this home and put it on your roof or in your house, and that will be the end of the matter.” The idea of being able to purchase such items in a large do-it-yourself shop and take them home and install them—an idea that many people would welcome greatly to make a breakthrough in the way that microgeneration is marketed—is some way off, because it is not possible to give such advice when the devices are sold. It entirely depends on the part of the country where the device is sold, and it may be that the place of sale is not the same as the place of installation. In effect, 400 pieces of advice have to be given on any one item.
I declare an interest at this point, because at the moment I am engaged in extensive clarification with my local authority on the installation of a windsave device on the roof of my house. I hope that I shall not have to pay £265 and go through the planning permission process, but I do not know that at the moment. It is that uncertainty that, in my recent experience, is a real issue in moving forward with microgeneration technology.
The new clause attempts to clarify the position by empowering the Secretary of State to carry out a review of the effect in England of the permitted development orders. Once the review has been undertaken, the Secretary of State is empowered to form a view on whether those orders should be extended to such devices—with proper safeguards in relation to such matters as conservation orders and the size and effect of equipment and appliances—and on which devices might be placed within the permitted development order category. It asks the Secretary of State to submit a report on the conclusions of the review as soon as that review is completed. I hope, and naturally I am confident, that a review such as the one that the new clause empowers would ensure that the change in permitted development orders would enable microgeneration devices—solar PV, solar water, combined heat and power boilers, ground heat pumps and wind turbines of a domestic nature—to be installed as a matter of course when a householder wished to install them.
Were that to be done, the step change in the ability to market and install microgeneration could be well under way. With that and a number of other devices, the atmosphere surrounding the perception and installation of microgeneration would begin to change, and that would take us a long way towards our shared goal of ensuring that this technology plays a real role in our energy production.

Malcolm Wicks: Both the new clauses are important and we have had a useful debate about them. Although the Government resist the inclusion of new clause 16, we fully agree with the sentiments behind it.
We recognise the crucial role that renewable energy can play as part of our armoury in combating climate change, and the provision of renewable energy on site as part of new developments is vital to that. However, we believe that legislation placing specific requirements on local planning authorities and  developers is not necessary, although I have listened to the arguments of the self-proclaimed localists on the need for central direction here. Progress will be achieved through action at the local level, delivered through existing planning mechanisms and within the context provided by national guidance on planning and renewable energy in planning policy statement 2, which is also known, I am advised, as PPS22—not the usual kind of PPS.
Gregory Barkerrose—

Malcolm Wicks: The hon. Gentleman wants to intervene at this early stage in my remarks.

Gregory Barker: I do. I want to ask the Minister a simple question. If we do not need to change the legislative framework, why is such action not taking place now? Why do we have these islands of good practice and seas of minimum standards? What possible hope can there be of changing, in the immediate future, that disparity up and down the country without a change in the system?

Malcolm Wicks: I want to continue, and to say more than I have been able to so far. The hon. Gentleman raises an interesting point. Here we have a longish list of local authorities, although it by no means approaches the majority. They are doing the right thing on this—that seems to be the consensus in the Committee—and perhaps we should all play a role in embarrassing the local authorities that are not on the list. Although I jested with the hon. Gentleman, many of us often want to be localists and to resist the heavy hand of the central state. Perhaps we should go out and prepare to challenge local authorities across the country on why they are not on this glorious list.
I shall come to detailed comments about the new clause, but perhaps I should clarify the provisions set out in PPS22 and say why I consider them to be sufficient to ensure that the purpose of the clause can be met without the need for legislation. PPS22 was published in August 2004 and was warmly welcomed by the renewables industry. As national policy, local planning authorities are required by legislation to have regard to it when preparing development plans. In practice, the “have regard to” test is a strong one. Planning authorities will need to have very good reason to depart from it in their plans, which will be scrutinised by the first Secretary of State—[Interruption.] I think of him very much as the first Secretary of State; I hope that he notes that. I should have said that the plans will be scrutinised first by the Secretary of State and will then be subject to testing at public examination by an inspector. The Government have recognised that policies, such as those produced by the London borough of Merton, can play a vital role in ensuring that we maximise the potential for on-site renewables. As an adopted plan, Merton’s policies have the Government’s tacit endorsement.
I was touched by the shadow spokesman’s proclamations about Croydon. I have often wondered whether I am right or wrong in not being one of those  MPs who mentions his constituency or borough in every paragraph of every speech. Some do that very well. I have never quite been in that camp. Although the hon. Gentleman is not exactly applying to become my research assistant should things go wrong for him at the next general election, I was still touched by his repeated mention. Essentially the argument was today Croydon, tomorrow the world when it comes to microgeneration. The good electors of Croydon will be marching to the polls in May to the drumbeat of his endorsement. I thank him for that.

Andrew Stunell: Will the Minister give way?

Malcolm Wicks: We must not waste too much time on further endorsements.

Andrew Stunell: I wonder whether the Minister expects to be as successful in Croydon as he was in the western isles.

Malcolm Wicks: Despite my modesty in mentioning Croydon, Croydon, Croydon at every opportunity, I am told by the psephologists that for some reason I have the largest numerical majority in Greater London, so something is going right.
PPS22 is supported by a companion guide in which the Merton example is used as an example of a local plan to secure on-site renewables. That guide also has a whole section devoted to developing renewable energy in the built environment. Paragraph 8 itself endorses use of Merton-style policies. It says:
“Local planning authorities may include policies in local development documents that require a percentage of energy to be used in new residential, commercial, or industrial developments to come from on-site renewable energy developments”.
The text in PPS22 then goes on to indicate that such policies should be applied only to developments where the installation of renewable energy equipment is feasible given the type of development, its location, and design. It also indicates that the policies should not be framed in such a way as to provide an undue burden on developers.
Those qualifications are important and necessary to ensure that a balanced approach is taken and that is based on a proper assessment of the potential for renewable energy when individual planning applications are received. More planning authorities are putting such policies in their plans, either at the regional or local level. And we expect more to do so as the new style plans come forward, following the introduction of the new plans system in 2004.
In terms of the specifics of the new clause, the Government consider there to be some fundamental problems. Subsection (1) would be a prescriptive measure that applied in all circumstances. It would allow no flexibility to be varied for different types of development, in different locations and in differing circumstances. It would not allow the potential of a specific site for renewable energy to be properly assessed when an individual planning application was made. Also it might have the unintended consequence of raising the costs of developing particular sites and  reducing their economic viability. At present authorities are using their planning powers to seek provision of a percentage of energy from on-site renewables. The percentages sought may vary between authorities, but we believe strongly that decisions on such matters should be left to local discretion.
Subsection (2) would set a precedent by specifying what development plans should contain. Planning legislation does not currently specify the content of plans. Instead, local authorities are required to have regard to national guidance in deciding the content of their plans. They therefore retain the autonomy—one could say the localism—to prepare policies in accordance with the needs and circumstances of their areas.
The new clause would also set a precedent for planning legislation by requiring that the possible extra costs of a development be met by developers. Although there are many requirements placed on developers—for example, the provision of open space alongside proposals for housing development—those are matters for individual planning authorities to decide, having regard to national guidance and the needs of their areas.
Nevertheless, we recognise that concerns have been expressed as to whether all authorities will include policies on on-site renewables, as PPS22 says they should. At the moment, however, only limited evidence is available. My hon. Friend the Minister for Housing and Planning has given a commitment that her Department will undertake an urgent review of local plans to determine whether there is a problem with emerging plans that do not fully incorporate PPS22 guidance. If a problem is identified, her Department will take swift and appropriate action.
Depending on the severity of any problems identified, that action could include undertaking further direct engagement with local authorities, issuing a Government statement, or consulting on an amendment to PPS22 in order to make clearer what authorities should do when planning for on-site renewable generation.
Although we completely support the principle of the new clause, we do not consider primary legislation to be required. However, we will take positive action to address the underlying issue. I hope therefore that the hon. Member for Bexhill and Battle, who moved the clause so well and with much knowledge, might consider my remarks and recognise why I oppose it.
We do, however, support new clause 19. Of course, we want to make it easier for householders to install microgeneration equipment, including the sort that my hon. Friend the Member for Southampton, Test mentioned, such as photovoltaics, roof-top wind turbines, solar thermal panels and combined heat and power units. Prompted by my hon. Friend, I shall declare an interest in the issue. Like him, I am in the early stages of negotiating a micro-wind turbine on my own dwelling, which obviously is in Croydon—a leader in the field. I declare an interest in at least two senses of the word. Indeed, I might swap notes privately with my colleague afterwards.
In April, for those reasons, we will publish a wide-ranging strategy for the promotion of microgeneration. The ODPM has been conducting a review of householder development consents. That review was set up to address the problem posed by the unnecessary complexity of the planning legislation that governs minor consents. The legislation is possibly too constricting, and could be interpreted in different ways by local planning authorities. In many cases involving the installation of microgeneration equipment, it is not clear when an application for planning permission is required. The review will be published soon.
Clause 2 of the Management of Energy in Buildings Bill would have required the Secretary of State to amend the secondary legislation—the general permitted development order, which I am advised is sometimes known as the GPDO—in order to permit small renewable energy developments. That would mean that such developments would not need specific planning permission.
We supported the earlier intention of my hon. Friend the Member for Southampton, Test to allow householders to install microgeneration equipment without the need of express planning permission, although that would be the case only if the installation were to have an appropriate impact on the amenity of the neighbourhood. However, we did not want to have to implement a succession of small amendments of householders’ rights under the order. Instead, we now propose to take forward our reappraisal of the permitted development rights currently available for dwelling houses. The review will seek ways to simplify the relevant sections of the GPDO, so that planning authorities and householders will have a clearer idea of the situations in which microgeneration technologies could be installed without the need for a planning application.
The new clause fits well with the programme on which the ODPM has already embarked. It requires the Government to conduct a review to assess what more can be done to make it easier under planning controls to install microgeneration equipment in houses. At the end of the review process, the Secretary of State must report his conclusions to Parliament and then put forward a new permitted development order. I therefore support new clause 19, but for the reasons that I have given, I oppose new clause 16.

Gregory Barker: I shall first deal briefly with new clause 19. I am glad to hear that the Minister supports the sensible new clause tabled by the hon. Member for Southampton, Test. I also strongly support its encouragement of the consumer to buy microgeneration technology, and of manufacturers to invest in it. That is critical, and the new clause is a small but welcome step. We must have a level playing field and clarity in the market for consumers as well as manufacturers. The new clause will greatly help to push the mass market that we want.
In supporting new clause 19, I should declare my newly installed solar panels, which were the subject of a class discussion a couple of weeks ago on sources of energy in which my 10-year-old son, his teacher tells  me, participated energetically. They were discussing various types of fuel, and he proudly told the class that we had had solar panels put in at the beginning of January and that he had not had a hot bath since. Despite those initial teething problems, I am confident that the Barker family will play their role in reducing carbon emissions, even if it is at the expense of a little cleanliness.
To be serious for a moment, there is, for the first time, an issue that divides us. I refer to new clause 16. I am sympathetic to what the Minister says, and I know that he speaks with a great deal of sincerity, but there is a fundamental question to be raised. We know that the current system is not working, and that we are not reducing our CO2 emissions at anything like the rate that would enable us to hit our 2010 targets. Frankly, we will have to move heaven and earth to hit our 2050 target. We must completely change the way in which we look at power generation and energy efficiency, and live our lives and use transport—a whole range of issues. There is so much that we must do, and simply tinkering with the planning system and playing with the existing levers will not get us anywhere. I appreciate the Minister’s saying that his colleague will revisit the issue, but none of us in this room would be here if we did not believe passionately that we needed to take urgent action, and that the existing system was not working.
I do not know when the next such opportunity will present itself. I accept that the new clause may not be perfect, but I say to the hon. Member for Edinburgh, North and Leith that the fact that it refers to regulations set by the Secretary of State means that it contains a degree of flexibility that the Secretary of State could sensibly use.

Mark Lazarowicz: The hon. Gentleman is obviously building up to a crescendo when he will say that he will put the matter to a vote, as he is entitled to. The regulations refer only to on-site renewable energy, and do not help with the issue of appropriateness, which I raised. In developing the Bill and accepting the various changes that have been made to it, I have been conscious that to take it forward, one has to recognise not just the practicalities of getting support, but that we must have the right wording and regulations. It is understandable that one might one want to work along lines that have a superficial attraction but, to have an effect, the wording must be right.

Gregory Barker: I take on board what the hon. Gentleman says, but I do not accept that the wording is not right. The advice that I took when drafting the new clause did not throw up that point. I notice that the Minister, with the benefit of advice of officials, did not deploy such an objection. I accept that the new clause could be improved further, but I do not think that we can let the opportunity to legislate on the issue pass by. Goodness knows how few and far between such opportunities with private Member’s Bills will be. It is remarkable that we have got this far.

Malcolm Wicks: May I clarify one point? The hon. Gentleman said that he had heard me say that my hon. Friend the Minister for Housing and Planning would  examine the issue. We have looked at this very carefully and she undertakes to initiate an “urgent review”—those are her words—of local plans and I asked what could follow from that including an amendment to PPS22. This is not a casual look at it. This is a matter of urgency because we understand his arguments and we understand the urgency of the issue.

Gregory Barker: I appreciate that, and such action may have to be taken if the new clause is not accepted. I am not trying to create differences between us where none exist. I accept that we are at one in trying to achieve the same aim. I am being realistic. We have an opportunity to legislate; indeed, we are sent here to do so. We are in this Committee scrutinising the Bill. There is a huge opportunity here which I, as an individual Member of Parliament and a Front-Bench spokesman, would hate to miss. Why put it off until tomorrow when we can do it today?
I shall be entirely frank with the Committee and show a degree of political candour. This is probably a new clause that the Conservative Front-Bench spokesman before 6 December would never have been able to move or possibly even support. This represents a new, fresh look at the way in which we will drive forward our climate change goals. I am breaking confidences when I say that there was significant debate within my party among the Front-Bench teams about whether the new clause could be supported. It went all the way up to my right hon. Friend the Member for Witney (Mr. Cameron).
We are a party that is fundamentally one of enterprise and business, and that is always loth to impose new regulations either directly on business or on Government or authority. We always think very hard about imposing any form of new duty or regulation through primary legislation, so a new clause such as this is not something that comes easy to us. We recognise, however, that climate change transcends any of those objections and that we have here an opportunity to do something.
If the Government were on course to hit their climate change targets and if we thought that there was any sort of slack in the system, I would defer to the Minister, who has a great deal of knowledge and speaks with conviction on this matter. But we are not. We are miles off and we are kidding ourselves if we think that we have the time to tinker with the existing system rather than put in some really radical reforms. This is not a hugely radical measure, but it goes further than the officials in the Department perhaps want to go. It is incumbent on us as politicians and opinion leaders to put down a flag and say that this is something we believe in and that the system must change sooner. I do not seek to endanger this tremendous Bill or in any way fracture the excellent spirit of cross-party consensus that has existed today,  but this is important. The Opposition feel strongly about the matter and we will push the new clause to a vote.

Question put, That the clause be read a Second time:—

The Committee divided: Ayes 5, Noes 10.

NOES

Question accordingly negatived.

New Clause 17 - Reports under section 1 of the Sustainable Energy Act 2003: community energy projects and renewable heat

In section 1(1A) of the Sustainable Energy Act 2003 (c. 30) (annual reports on progress towards sustainable energy aims)—
(a)at the end of paragraph (b) insert—
“(ba)things done during that period pursuant to section 9 of the Climate Change and Sustainable Energy Act 2005 for the purpose of promoting community energy projects;
(bb)things done during that period pursuant to section (Renewable heat) of that Act for the purpose of promoting the use of heat produced from renewable sources;”, and
(b)in paragraph (c), after “sections 2 and 3” insert “of this Act”.’.—[Malcolm Wicks.]

Brought up, and read the First time.

Malcolm Wicks: I beg to move, That the clause be read a Second time.
That was exciting after all the consensus. The figure of the Leader of the Opposition joined us in the Committee room, at least spiritually—and not for the first time. One day there will be a wonderful doctoral thesis with the title, “New Conservatives: the new localism and climate change”, in which the words of the hon. Member for Bexhill and Battle will be much cited.
New clause 17 is easier, because in our previous sitting we had a good discussion about the promotion of renewable heat and community energy schemes. To supplement the duties being imposed on the Secretary of State in those areas, I agreed to consider associated reporting requirements. The new clause imposes a requirement on the Secretary of State to report on the steps taken to promote renewable heat and community energy. That reporting will be done through the annual reports on energy policy that are already produced under the Sustainable Energy Act 2003. I hope that the  hon. Gentleman will agree that the new clause achieves the aims of the proposal that he withdrew in our previous sitting and that he will support it.

Gregory Barker: I thank the Minister, who has been true to his word. We had a lengthy discussion on this matter in our previous sitting, and he has come back with a proposal that exactly fits the purpose, for which I am very grateful.
Reporting back on renewable heat and community energy is important; it will stimulate the debate and allow us to monitor annually the progress that is being made. I realise that it could create a rod for the Government’s own back, but it is a matter of accountability, as people should be able to see what the nation is doing to meet these important objectives and hold politicians of whatever party to account. I am grateful to the Minister for acting on our suggestion. His proposition is very sensible and I am happy to support it.

Mark Lazarowicz: Without wishing to claim exclusive ownership of the Bill in anything other than the best sense, I point out that my understanding is that the second sub-paragraph in the new clause relates to my amendment on renewable heat. I, too, am happy to support the Minister’s proposal, which takes on board the points in that earlier amendment.

Question put and agreed to.

Clause read a Second time, and added to the Bill.

New Clause 19 - Review of permitted development orders

‘(1)The Secretary of State shall for the purpose mentioned in subsection (2) carry out a review of the effect in England of development orders made by virtue of section 59(2)(a) of the Town and Country Planning Act 1990 (c. 8) (which confers power by order to grant planning permission for development or a class of development specified in the order).
(2)The purpose of the review is to enable the Secretary of State to form a view as to what provision (or further provision) such development orders should make to facilitate development in England consisting of the installation, within the curtilage of a dwellinghouse, of equipment, apparatus or appliances for microgeneration.
(3)As soon as reasonably practicable after he has carried out the review, the Secretary of State must lay before Parliament a report of the review, including his view as mentioned in subsection (2) and the reasons for it.
(4)The report must also set out what provision (or further provision), if any, the Secretary of State proposes to make in development orders by virtue of section 59(2)(a) of the Town and Country Planning Act 1990 (c. 8) in consequence of the review.
(5)Where the Secretary of State proposes to make provision (or further provision) in development orders in consequence of the review, he must—
(a)exercise his powers under section 59 of the Town and Country Planning Act 1990 (c. 8) so as to provide that development orders made by virtue of that section make such provision in consequence of the review as he considers appropriate, and
(b)exercise those powers as soon as reasonably practicable after laying the report before Parliament under subsection (3).
(6)In this section—

Brought up, read the First and Second time and added to the Bill.

New Clause 20 - Building regulations: microgeneration

‘In Schedule 1 to the Building Act 1984 (c. 53) (building regulations), in paragraph 7(a), after paragraph (xxiid) insert—
“(xxiie)the production of heat or the generation of electricity by microgeneration (as defined for the purposes of this paragraph by building regulations),”.’.—[Dr. Whitehead.]

Brought up, and read the First time.

Alan Whitehead: I beg to move, That the clause be read a Second time.
The provisions that may arise from the new clause would in many ways reflect the aims and ambitions that the hon. Member for Bexhill and Battle mentioned in speaking to his new clause 16. I understood his reasons for seeking to press his new clause to a vote, but I was a little sorry that, to try to ensure that the Bill reached the statute book, I considered it necessary not to vote for it. I think that everybody will wholeheartedly agree with much of what he said, however, and with the content of the new clause. I hope that all members of the Committee will be able to agree that new clause 20 would pave the way for much of what the hon. Gentleman sought to make a reality.
The new clause is the result of discussion of how such a clause could become law, following the tabling of a similar clause in the private Member’s Bill that I moved for Second Reading on 11 November last year—the Management of Energy in Buildings Bill. The ambition of that Bill, which is also central to the Bill before us, is that future building regulations should define the level of energy that houses should produce in relation to the amount of energy that they consume in any one year. An ideal building regulation would measure the amount of energy that a house used in a year, like the mileage on a vehicle. Under building regulations, the builder of such a house would be required to choose from a palette of different forms of microgeneration the forms that could be installed in a way that produced energy to a set proportion of the total amount generated. Therefore, the house would not simply be a relatively efficient low consumer of energy, but would be a positive producer of energy, as a result of the daily living that went on in it. Members of the Committee will not need much mathematics to realise that, if such a measure were installed in the new houses built each year, the gain in terms of the widespread introduction of microgeneration with a guaranteed market for microgeneration devices and the saving of CO2 would be enormous and would make a substantial contribution towards our target of  moving towards a low carbon and renewable energy economy where possible. Therefore, the new clause would have substantial potential, should it be adopted.
The new clause would pave the way towards that potential by introducing into the Building Act 1984 an additional range of items that building regulations may include. I am sure that when the new clause was first published, hon. Members anxiously scanned their copies of the 1984 Act. If they tried to do that by recourse to the internet, they will have realised that the publication of Bills on the internet goes back to 1988, which meant that I was ably assisted in obtaining the relevant schedule. That schedule sets out a large number of things that we are now familiar with from the various building regulations from A to L—or whatever they are; I should have worked out the number of letters. Nevertheless, there are regulations on the passage of sound, open spaces around buildings, ventilation, standards of heating—all the things that are included in the 1984 Act—and at the end is appended the statement that building regulations may be introduced on the production of heat or the generation of electricity by microgeneration as defined for the purposes of the paragraph in question by building regulations. Therefore, the Act looks to such a building regulation being enabled.
The code for sustainable buildings is widely known as the precursor to building regulations. It encourages those building new homes to go beyond the present building regulations and employ, as a matter of course, standards of building construction and finishing that are reasonably uniform and that mean a level playing field for development, but that go beyond the minimum that might be required by current regulations. In that sense, a code for sustainable development heralds what the direction of travel for building regulations is likely to be. However, the heralding is towards the top end of the code; the code is not where one might ideally like it to be.
My hon. Friend the Minister for Housing and Planning said on Second Reading of my Management of Energy in Buildings Bill last November that
“there are additional ways we can promote micro-generation, such as through the code for sustainable buildings”.—[Official Report, 11 November 2005; Vol. 439, c. 660.]
That was a welcome and important statement on my Bill, which I hope can be reinforced by what is said on this new clause. Ideally, the code for sustainable buildings would be refined in terms of the requirements that it places on builders.

Joan Walley: My hon. Friend is speaking about the importance of the code, and my hon. Friend the Minister spoke earlier about the possible need for more guidance from the Government about the communication of this Bill’s objectives. In view of that, does my hon. Friend the Member for Southampton, Test agree that this is another area in which a strong message could go out  from the Minister about the Committee’s concern that we should aim for the highest possible outcome for the code while we are still in the consultation period?

Alan Whitehead: My hon. Friend makes an important point about how the outcome of the consultation might be a code that not only indicates the general direction of travel, but lays things down very clearly by specifying, for example, the years after which building regulations might be introduced and the level at which those regulations might be introduced. I am thinking of the levels that are currently part of the building code consultation.

Andrew Stunell: Does the hon. Gentleman agree that it is tragic that it is a code not for sustainable buildings but for sustainable housing and that the buildings element has been taken out of the consultation that we are undertaking? That means that only half the building stock will be covered by it.

Alan Whitehead: I am sympathetic to the hon. Gentleman’s point, and it may be something that can be considered in the consultation. Nevertheless, let me explain what the important point is about the relationship of the new clause to the code for sustainable buildings. I hope that, if adopted by the Committee and incorporated in the Climate Change and Sustainable Energy Bill, the measure will provide a clear means by which building regulations may be not only heralded but implemented within a set time. That would ensure, among other things, that those people who are considering investing in building and in the equipment that goes into building would have a clear indication at an early stage of what is required and will be required in the future and, therefore, of how they should plan for the future development of buildings.

Andrew Stunell: I believe that the new clause should be added to the Bill. It would send a signal, but the hon. Member for Southampton, Test should not have too high an expectation of what it would achieve. I say that because I added two items to paragraph 12 in my Act—I am turning into a bit of a self-promoter in the debates on this Bill. I added two bits to the 1984 building regulations, and I was told that it was the first time that the primary legislation in the Building Act 1984 had been amended at all since 1984. Another change would not be a bad thing.
I added two-way meters and recycling to the themes on which it would be competent to have building regulations. It should be noted that the list to which the new clause would be added is a permissive—or even weaker than that—illustrative list. It certainly does not in any way bind anybody to doing anything. The new clause is worthy and worth while, but we should not get too excited about what it would achieve.
In the context of a Bill that is trying to promote microgeneration and ensure that things happen, the new clause is a useful but rather small part of the jigsaw. Each year, the building regulations apply to only about 1 per cent. of the building stock, yet the building stock contributes a significant fraction of the  carbon output of the United Kingdom. Only 1 per cent. of it is caught by building regulations, and that is the 1 per cent. that is built each year.
It would be good to hear the Minister say that he will urge colleagues to apply other unused parts of the present building regulations. They would apply when alterations and renewals of buildings are done and when buildings are purchased or changes of occupancy take place. In that way, we would be able to speed up the necessary changes much more quickly.
Microgeneration is, in essence, a heating system. A million central heating boilers are replaced each year in this country. The huge majority of them are not in new premises but in old premises, and they are not in any way caught by the present regulations. The hon. Gentleman referred repeatedly to the code of sustainable buildings, but it is not that—it is the code of sustainable housing. It sets standards that are lamentably below the high levels that one might have expected from, for instance, the Building Research Establishment’s eco-homes standard.
The statement by the ODPM that the Bill is in some way a substitute for proper regulation should not be accepted. This is an opportunity for the Minister to blow away the fog that is being created by the ODPM and to say that he accepts the urgency of making things happen in this area, that he accepts the new clause, and, more than that, that he will go back to his desk and write a stern memo to the ODPM to get a move on with sustainability.

Philip Hollobone: The elephant in the room with this Bill is the ODPM’s house building programme. Hundreds of thousands of new houses will be built in this country by 2031, and my constituency is right in the middle of one of the growth areas. There are 36,000 dwellings in Kettering borough; there will be an additional 13,100 by 2021, and between 5,000 and 10,000 will be built between 2021 and 2031. The Bill gives constituencies such as Kettering a huge opportunity to ensure that those new houses conform as much as we would like to energy efficiency and anti-climate change measures.
The new clause on which we divided was essentially about planning regulations, and I am sorry that that vote was lost. The new clause before us is about building regulations. Although we may not be sending a clear signal on planning law, we can send a clear signal on building regulations that will catch in time the new build that will take place in my constituency. I humbly submit that, in constituencies such as Kettering where housing stock will increase by a third in the next 15 years, getting regulations right in the context of the Bill is crucial.

Gregory Barker: I praise my hon. Friend the Member for Kettering (Mr. Hollobone) for his sensible and spot-on intervention. He reminded us of the practical implications with which we should concern ourselves.
I entirely endorse the points made by the hon. Member for Southampton, Test, who tabled this new clause. It should come as no surprise, because he has a tremendous track record in the area and is one of our  great experts. However, I am concerned that the new clause does not go quite far enough. He made the point that, on Second Reading of his Management of Energy in Buildings Bill, the Minister for Housing and Planning said that she would use the code for sustainable buildings to promote microgeneration:
“We ... believe that there are additional ways we can promote micro-generation, such as through the code for sustainable buildings, on which we will consult shortly.”—[Official Report, 11 November 2005; Vol. 439, c. 660.]
However, the current draft of the code is disappointing and in no way fulfils the promises that the Minister made on Second Reading. Microgeneration, which has many enthusiasts in this Committee, hardly features at all. In some important cases, it is omitted altogether.
Without being unfair to the Minister in any way, I shall give the Committee a few examples. On page 17, under the proposed essential elements of the code, energy efficiency is defined as the
“conservation of fuel and power”.
Nowhere is microgeneration included separately. On page 19, in a table under the heading “Establishing Minimum Standards”, energy efficiency is defined in the same way, with no mention of microgeneration.
On page 24, in the paragraph “Establishing the Minimum Standard”, microgeneration does feature, but only as an alternative to energy conservation for homes unable to access mains gas. The paragraph says:
“Homes unable to use mains gas for space and water heating will have to invest in additional energy efficiency measures or incorporate lower carbon technologies, such as microgeneration, than homes that use mains gas for such uses.”
That is really not good enough. Nor should energy efficiency be seen as an alternative to sustainable energy or microgeneration. That is not what we expected when the Minister for Housing and Planning spoke in November.
I can give other examples. On page 42, in appendix F, the first objective listed is
“improvement in energy efficiency of new homes”,
with no mention of the promotion of microgeneration. Page 43 lists the guiding principles of the IRA. Did I say “IRA”? I meant to say “RIA”. Again, there is no mention of microgeneration, and perhaps we should hold the Secretary of State for Northern Ireland to account for that. There is mention only of energy efficiency. Pages 44 onwards make no mention of the benefits of microgeneration; only energy efficiency is mentioned.
There is a real danger that in some quarters even in the environmental movement, energy efficiency is seen as an alternative to microgeneration or decentralised energy. It is not and it must not be presented in that way, because that is a false argument. We must be full advocates of all those technologies and of energy conservation and efficiency. Page 44 merely mentions it in passing as a low carbon technology when it should have been included in all the relevant sections, all the way through, particularly those headed “Essential Elements”.
The Government have spoken consistently of their support for microgeneration, and the Energy Savings Trust report for the DTI clearly shows that microgeneration could deliver up to 40 per cent. of electricity needs by 2050. That is ambitious, but we should be ambitious. That can happen only with the right regulatory and policy frameworks. Without those, microgeneration will remain the niche product that it is at the moment and the benefits will not be achieved.
The Minister is reasonable, so will he repeat the promise made by the Minister for Housing and Planning back in November and this time drive the Government hard and ensure that the sustainable buildings code will be changed accordingly? So far, it is not good enough.

Malcolm Wicks: There will come a time when we can compare and contrast the record of previous Conservative Governments on climate change with our own. Some of us are still trying to come to terms with the idea of the cleaner and greener Conservative party. We look forward to discussing the Conservatives’ voting record on the climate change levy and the hon. Gentleman may want to announce a change of policy on that, which would be of some historic importance.

Gregory Barker: I really do not want to get into an historic argument because I am focused firmly on the future. Perhaps the Minister could tell us whether carbon emissions fell dramatically between 1990 and 1997 under the last Conservative Administration, and whether they rose during the first years of this Government.

Malcolm Wicks: Part of the story is the attack on manufacturing industry and the move to a service sector during those years, which had an effect on emissions. We should discuss that with care on another occasion.
We support new clause 20, which will create a new power to make building regulations requiring the incorporation of microgeneration technologies in new build. I was asked about buildings other than housing, and I am advised that a code for homes is a first step and that the Office of the Deputy Prime Minister will develop a code for buildings at a later stage. The question is important, as is the answer.

Joan Walley: It would be enormously helpful to have some idea of when the further code on sustainable buildings might be with us.

Malcolm Wicks: My hon. Friend will understand that I must seek advice on that. If I can give any advice during a later stage of our proceedings, I shall be happy to do so.

Andrew Stunell: When the Minister receives or gives that advice—he seemed unclear about which was which—will he encourage the adviser to come forward with an early timetable? The material was going to be published for consultation last autumn and at the last  minute it was pulled back. Many of us were puzzled by that, bearing in mind what we thought was the intended direction of Government policy.

Malcolm Wicks: I obviously need to receive advice on this occasion, as on many occasions, not least because it will come from a sister Department, if the Secretary of State for that Department will forgive me for using that expression.
Creating the power will allow the option of requiring a full consideration of microgeneration, when justified, as a means of conserving fuel and power. When new buildings are constructed or existing ones are materially altered or their use is changed, the power will ensure that there is an opportunity for those important technologies to contribute to the built environment’s carbon savings.
We know that a draft code for sustainable homes has been issued for public consultation, and in that context, my hon. Friend the Minister for Housing and Planning would welcome suggestions about the positive role that microgeneration might play. In her consideration of the responses to the consultation, she has stressed that no options will be ruled out, and she is hopeful that a way can be found to promote microgeneration by, for example, awarding more points for its installation. I therefore urge my hon. Friend the Member for Southampton, Test to advance the case for its use in that context. It is important that the consultation exercise takes full account of the potential benefits of such a technology and how it can contribute to the code’s effectiveness.
Hon. Members made one or two points about existing building regulations. I am told that current building regulations include replacement windows and boilers in existing homes, so upgrades will have to conform to the new regulations, even if they did not previously.
The hon. Member for Bexhill and Battle has obviously made a textual analysis, but not an adequate one, because as he will reflect, page 28 of the draft code says:
“Additional code points available where zero emission energy sources are specified”.
In response to the notion that building regulations do not do enough, the 2006 revision of part L will impose significant improvements in relation to carbon emissions, requiring for homes a reduction of 20 per cent. compared with the existing regulations. The tenor of my remarks is that we are not complacent, and that colleagues are considering the matter.
I agree with the Liberal Democrat spokesman, the hon. Member for Hazel Grove (Andrew Stunell), that we need to consider not only new build but existing dwellings. Most of the Bill is about microgeneration in existing dwellings, including, I hope, those of members of the Committee, should our negotiations progress. That is an important point. There is an obligation on the supply companies, known as the EEC—energy efficiency commitment—obligation, to consider the energy efficiency of customers, not least those on low incomes. In Scotland, there is also an equivalent of the  Warm Front campaign, which has improved energy efficiency and heating systems in 1 million dwellings in England.
I should not want to let the debate pass without acknowledging what has been done. The energy review, which I am conducting, is also taking energy efficiency in existing dwellings very seriously. As I have said, I am therefore happy to support new clause 20.

Question put and agreed to.

Clause read a Second time, and added to the Bill.

New Clause 21 - Reduction of greenhouse gas emissions: report regarding dynamic demand technologies

‘(1)The Secretary of State must, not later than 12 months after this section comes into force, publish a report on the contribution that is capable of being made by dynamic demand technologies to reducing emissions of greenhouse gases in Great Britain.
(2)The report must state the view of the Secretary of State as to whether it is appropriate to take any steps to promote the use of such technologies, and, if it is, what those steps are.
(3)In forming the view mentioned in subsection (2) the Secretary of State must have regard, in particular, to any matters which would prohibit or inhibit the use of any dynamic demand technology in any circumstance in which its use could be expected to make a contribution to reducing emissions of greenhouse gases in Great Britain; and the report must state the matters to which he has had regard.
(4)In this section—
(c)the consumption of electricity, at a particular time, by a device connected to a network, or
(d)the generation of electricity, at a particular time, by an electricity microgenerating system connected to a network,
to be controlled or adjusted automatically by reference to, or matters relating to, the frequency of alternating current on the network at that time;

Brought up, and read the First time.

Alan Whitehead: I beg to move, That the clause be read a Second time.
Hon. Members may still be wondering what the definition of dynamic demand is. It is not what despairing Southampton football club fans are demanding of their team, but a relatively new series of technologies, which overall could make a substantial difference to the deployment of national grid resources. The duty cycle of a device, when it is powered, can be regulated by micro-controllers that detect slight changes in the balance of power supplied to it. In that way, they effectively reflect the extent to which the grid is being heavily used or less heavily used. If attached to a device, the micro-controllers would switch it on when the grid was less heavily used and switch it off again when the grid was more heavily used.
I am sure that hon. Members are now in a state of deep slumber, but I will attempt to awaken them again by referring to the new clause itself. If the new clause is adopted, the Secretary of State will be required, not later than 12 months after it comes into force, to publish a report on what contribution might be made by the technologies to reducing emissions of greenhouse gases. In addition to that report—assuming that the technologies are regarded as contributing to reducing emissions of greenhouse gases—the Secretary of State will be required to consider appropriate steps to promote the way forward for those technologies. The devices concerned might include refrigerators, air conditioners, water heaters and perhaps heat pumps. There are a range of devices that could benefit from having these dynamic demand processes attached to them.
It is estimated—the figures are, of necessity, a little speculative—that if the devices were fitted fairly widely, more than half a megatonne per year of carbon could be saved. That seems a substantial saving. I hope that the Committee will adopt the new clause. Should it be adopted, I hope that a report will be forthcoming in due course to underline how, in the medium term, such technologies can be used. Obviously, in the case of things such as air conditioners, perhaps that would merely involve putting back some of the deleterious effects on the overall use of energy that we may otherwise see, but, nevertheless, a substantial benefit may be achieved.

Gregory Barker: I do not propose to detain the Committee for long. The hon. Gentleman has again given us a glimpse of his expertise in this area. We strongly support the broad thrust of the measure.

Malcolm Wicks: That was very energy efficient; I must learn from the hon. Gentleman.
As we have heard, new clause 21, which might be the last new clause that we consider today, will impose a duty on the Secretary of State to publish a report on the contribution that dynamic demand technologies could make to reducing greenhouse gas emissions in Britain. The report will also address whether it is appropriate to take any steps to promote the use of those technologies and, if it is, what those steps might be.
We have been taught that dynamic demand technologies are technologies that enable the consumption or generation of electricity to be controlled or adjusted automatically according to network frequencies. I am advised that, in English, that means that these are clever pieces of kit that can adjust the demand of our appliances to help to balance the load on the grid. I have been given an example. If the technology senses through an assessment of the frequency levels that demand is growing, it will turn the fridge down, or so I am told. Another application could be that if the technology senses that a difficult item is coming up on the “Today” programme that might upset a sensitive Minister, the radio will automatically be switched off. [Laughter.] As one of  our distinguished political commentators said: I made that one up. It was so far-fetched, it must have been the one about the refrigerator.
The overall benefit of these technologies is that a smoothed demand pattern leads to a reduced need for back-up generation. It is claimed that that could save up to 0.6 million tonnes of carbon per year. The Government have done very little proactive work in this area to date—I do not understand why—although we have kept up to date with developments. It is clear  that these technologies deserve closer investigation, to establish whether they could make a significant contribution to reducing our carbon emissions.
I am happy to support new clause 21, and I look forward to the conclusions of the report that it requires.

Question put and agreed to.

Clause read a Second time, and added to the Bill.
Further consideration adjourned.—[Joan Ruddock.]

Adjourned accordingly at twenty-nine minutes to Five o’clock till Tuesday 28 February at Four o’clock.